Tax Cuts Will Be Popular When People See They Are Paying Less
Republican Senate leader Mitch McConnell said on Sunday he is optimistic the two houses of Congress will produce tax cut legislation that can be signed into law by Donald Trump.
“We’ll be able to get to an agreement in the conference,” the Kentucky Republican told ABC’s This Week.
McConnell also rejected criticism about the terms of the bill he shepherded through the Senate, its effect on the national debt and the way he managed its passage.
The Senate bill makes corporate tax cuts permanent but time-limits cuts for ordinary Americans. McConnell told CBS’s Face the Nation it was “impossible” to make middle-class tax cuts permanent.
“You can’t craft any bill that would guarantee no one was in a special category that might get a tax increase,” he said.
McConnell added that he was not worried by polls on the cuts, saying: “We’ll see how unpopular it is when people start noticing they’re paying less in taxes, the economy’s growing, there are more jobs and opportunity.”
His cause was not helped by the Iowa senator Chuck Grassley, who stirred anger when he told the Des Moines Register the controversial repeal of the estate tax, a move which will only benefit the very rich, “recognizes the people that are investing, as opposed to those that are just spending every darn penny they have, whether it’s on booze or women or movies”.
Independent bodies have found that the tax cuts will add as much as $2tn to the US national debt, the reduction of which has long been a pillar of Republican policy.
In Kentucky on Saturday, McConnell repeated his contention that the cuts would be “beyond revenue neutral”. “In other words,” he said, “I think it will produce more than enough to fill that gap.”
On Sunday Susan Collins of Maine, a GOP moderate who helped bring down healthcare repeal but voted for a Senate tax bill that includes the repeal of the Affordable Care Act’s individual mandate – a move analysts say would result in 13 million losing health insurance – appeared on NBC’s Meet the Press.
She followed the party line, saying she was not worried about the deficit because “economic growth produces more revenue and that will help to offset this tax cut and actually lower the debt”.
Analysts have predicted that should the GOP retain control of Congress in 2018, deep spending cuts will be implemented to counter debt increased by tax reform.
Collins said she had been given “an ironclad commitment that we’re not going to see cuts in the Medicare programme as a result of this bill”.
With only Trump critic and deficit hawk Bob Corker voting no on the Republican side and all Democrats against, the Senate passed its bill 51-49 early on Saturday morning.
Democrats including the Massachusetts senator and potential presidential candidate Elizabeth Warren protested, claiming they had not been given nearly enough time to read the near-500 page bill, in which often handwritten amendments were seemingly inserted to please Republican donors.
McConnell told CBS “the process on the [Senate] floor, the reconciliation process, is regular order. That’s how they passed Obamacare”.
One of his own caucus, however, admitted that he had not read the bill when he voted to pass it. Tim Scott, a member of the Senate finance committee from South Carolina, told CNN’s State of the Union: “I’m not going to say I read every single letter on every single page because it’s 470 pages and in its last hour I did not read 470 pages.”
A Democrat, Mark Warner of Virginia, told the same show he held out hope the tax cuts would fail in the conference process. But he said Friday “was my single worst day as a US senator”.
Calling the late-night vote “just plain stunning”, Warner said “this was swamp 101 … where the bill was being hand-drafted, lots of provisions were being included for special interests. One got exposed already, a religious college in Michigan backed by the [family of Betsey DeVos, Trump’s education secretary], getting special tax breaks.”
He added: “I will bet you we’ll see literally dozens more of these provisions put in.”
Trump was largely occupied elsewhere on Sunday, tweeting his rage over the Russia investigation. Attending fundraisers in New York City on Saturday, the president said Democrats’ opposition would “cost them very big in the election”.
On Sunday Mick Mulvaney, the director of the White House Office of Management and Budget who this week took contested control of the Consumer Financial Protection Bureau, attempted to address confusion over other remarks by the president.
Trump also said on Saturday he might be prepared to accept a cut in corporation tax from 35% to 22%, rather than 20%.
“I don’t think it’s change,” Mulvaney told CBS. “I think what you heard the president say is, ‘Look, we’re very close to the finish line.’
“You know he’s wanted a 15% rate from the very beginning … my understanding is that the Senate has a 20% rate now. The House has a 20% rate now. We’re happy with both of those numbers.
“If something small happens in conference that gets us across the finish line, we’ll look at it on a case-by-case basis.”
Both McConnell and Mulvaney also said no government shutdown was imminent, though a temporary spending bill is due to expire at midnight on Friday.
Attempts to negotiate have not progressed, partly due to Democratic attempts to achieve a deal on undocumented migrants brought to the US as children whose protection from deportation was withdrawn by the Trump administration.